You have difficulties in getting and keeping the talent you need to meet your business goals. Why? Is because you are not a “best employer”? Is it because your compensation and benefits packages are uncompetitive? Is it because you create a climate of instability as an employer because you periodically lay people off?
If you say yes, I say you are wrong. Why?
- Not everyone can be a “best employer”, the superlative best precludes that. Yes you can be a good and capable employer. However, there is little competitive advantage in this unless your talent competition is comparatively poorer at this task.
- Not everyone can be a top payer. Again, this is a zero sum game. Besides, somebody else will always have deeper pockets. Furthermore, if your organization is of any size and complexity it will have various roles and the competitive markets will vary with the role marketplace rather than just the organizational one. Also, larger organizations have internal “equity” issues to deal with (e.g., job evaluation, unionized jobs embedded relationships, etc.) which can lead to over compensation just as often as under compensation regarding the talent supply marketplaces.
- Nearly all organizations have to make periodic changes to their cost structure. I suppose the issue is do you run your business in such a way that it is a leader in “yoyoing” its payroll. If this at all the case, then I guess you expect to incur these talent attraction challenges.
So what is the talent problem?
Its the way you choose to do business and how you perceive talent being part of that. In other words its your “mental business model” that’s the problem.
The availability of adequate talent is not the problem, it’s how you choose to access it and make use of it that is.
Let me guess, your concept of talent management is one of getting and keeping great employees?
One way to get suitable access to talent is to put it on your payroll. This is what the description of talent management just above says. This is no different than your CFO saying the only way we can sustain and grow our business is to use retained earnings as the source of our working capital requirements. That may be your decision, but it certainly isn’t the only potential way you can access and source your working capital requirements.
The treasurer example above completely parallels the talent availability issue.
Relying on a singular strategy to meet a critical business input is risky because you don’t have as many options. You become completely exposed to any emerging vagaries that arise in the singular option. Why would you expose yourself to such a risk?
- The option is so comparatively attractive when it works that any other option pales in comparison. We can (and do) “fund appropriate types of insurance” to cover our risks with this option while we enjoy the benefits.
- There is no other realistic option available (there are operational, system, instrumental or institutional barriers to use of any other alternative).
- I cannot think of another practical way of meeting our talent needs here.
- Isn’t this what talent management (getting and keeping great employees) is about anyway?
Let us explore two clear examples of what the talent choices really can be:
Several decades ago, nearly all sports footwear (Puma, Reebok, Adidas, etc.,) producing firms had investments in their own manufacturing facilities. They had to didn’t they? How would they sell their footwear if they didn’t? So manufacturing is a critical business process, right? Nike proved to them that the answer was NO. Nike chose to contract manage its manufacturing requirements. It focused on design and marketing for its investments in employee centric talent. It soon dominated the related marketplace. Why? because it had more flexibility and cost advantages due to its investments in working capital.
Lesson: just because you have to do it (e.g., manufacture goods with the attendant talent implications) doesn’t mean you have to invest in it through the “employment strategy”.
Secondly, Apple and Microsoft have two distinct core business strategies regarding the development and marketing of software and hardware.
Microsoft chooses to focus on the software side and relies on its hardware partners to do the rest (Microsoft does do considerable amounts of marketing of its product services). This means as a customer you know that any product that has a Microsoft system on it will work in predictable ways, so your decision boils down to the hardware vendor of choice.
Apple focuses on hardware and does enough work on software to make its products standout (during use) from the competition. Even though Apple is a niche player in the personal computer market (less than 10%) it still is the most successful in capturing profits in the industry (approx. 50% of all profits?). From the customers’ perspective if there is an issue with an Apple computer, regardless of the reason, they only need to deal with Apple to try and get a satisfactory resolution. Anybody who has had issues with their Windows based machine know the challenges of getting resolution can be (standard comment heard: it’s the other party’s issue)
Lesson: you don’t always have to operate like the dominant pack to be successful. Investing in talent differently than your competition can have its advantages.
At the end of the day, both Microsoft and Apple deliver a similar product service offering through their respective distinct approaches: computer and software systems. Though they do it quite differently, both are extremely profitable. They are both successful in achieving access to great talent through employment and through indirect use of partner talent pools.
Lesson: If you have a talent issue that just won’t go away. Consider the way you do business (in that talent pinching area at least) as the root cause.
Those of us with an economist orientation , fully appreciate these lessons. For us this suggests that talent management is more than just a human resources (i.e., employee centric talent management) issue.